Is a daily "Sunset Limited" worth $750 million?

Union Pacific has told Amtrak that changing the Sunset Limited’s
frequency from triweekly to daily will cost the government-supported
company about $750 million in capital improvements. It’s fair to say the
vice presidents at Amtrak headquarters in Washington, D.C., are reeling
from sticker shock.

Here’s the back story: Earlier this year, Amtrak’s board of directors
approved daily operation of the Sunset, with an eye toward an
October inauguration. The stars seemed lined up in the heavens because
the existing equipment pool could cover the trips, and revenue gains
were estimated to cover the higher costs. The idea was to reorient the
train into a Los Angeles-Chicago service via San Antonio, Texas, with a section
also running daily between San Antonio and New Orleans. The Texas
Eagle already provides connecting service daily between Chicago and
San Antonio.

Hold it right there, said Union Pacific. We’ve got plans to run a lot
more Z (or express) freight trains across the Sunset Route in times to
come. Plus, every time you switch the Chicago-LA cars from the Texas
Eagle onto the New Orleans-LA Sunset at San Antonio, or vice
versa, our freight trains grind to a halt for a considerable period.

To test the impact of a daily Sunset on UP operations, the
railroad did a re-dispatching study, using Rail Traffic Controller
software. It assumed train volumes from pre-recession 2007. And it
stipulated one significant requirement: There could be no delay to the Sunset
or to any UP freight train.

Union Pacific came up with an estimate of $400 million in capital
improvements necessary to achieve seamless operation of a daily Sunset
west of San Antonio. Between San Antonio and New Orleans, more
study is necessary, but Amtrak people are of a mind that the bill for
infrastructure improvements, particularly in the Houston area, will come
to about $350 million.

So there you have it. Some UP people I’ve communicated with feel very
strongly that this will be (or should be) Union Pacific’s
take-it-or-leave-it position. Others are more open to a dialogue. But
right now the take-it-or-leave-it faction appears in control.

Here’s how I suspect this story will play out: His past behavior
suggests that Amtrak President Joe Boardman has no stomach whatsoever
for confrontion. So don’t count on his negotiating with UP’s chief
executive, Jim Young. Odds are that Amtrak will take this to the Surface
Transportation Board for adjudication. The STB will take a sword and
cut the baby in half, ruling that Amtrak must make some capital
improvements but nowhere near the $750 million. And about the time the
Obama girls graduate from college, you and I will be able to enjoy daily
service on the historic Sunset Limited.

Enjoy the photos from my recent trip, smoke stop at Del Rio, Texas (top), and from the westbound Sunset west of San Antonio. — Fred W.
Frailey